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Water is an essential resource for the NSW minerals industry. Mines need water for purposes such as minerals processing, dust control, irrigation, machinery cooling and staff amenities. Minerals processing tends to use the most water within a mining operation.
While water is critical to the mining industry, the industry uses just over 1.5% of the total water consumed in NSW. This compares to agriculture (44%), the water supply industry – including distribution losses (29%) and households (12%) (ABS Water Account, 2008-09).
Not only is mining a comparatively small user of water but it also generates exceptional economic returns from the water used. The 2004-05 average value added per megalitre (ML) of water used was around $86,000/ML for coal, $50,000/ML for metal minerals and $25,000/ML for other minerals. This compares to $40,000/ML for the industrial sector and $5,000/ML for the agricultural sector (CSIRO Process Magazine, January 2007).
At a local scale mines can use a large proportion of the available water in a region. Mines view water strategically and are driven to use water efficiently due to the low availability of water in some areas and the need to ensure continuing operations, community expectations and the cost of using water. Mines are amongst the most diligent, transparent and highly regulated water users in the State.
Mines get their water from a variety of sources depending on local conditions and requirements. Sources include rivers, groundwater aquifers, rainfall, water recycled on site, town effluent, town fresh water supply or water supplied by a third party such as another mine.
While water quality is important for some aspects of mining and minerals processing, lower quality water such as treated effluent and saline groundwater can be used for some purposes. This reduces a mine’s demand for higher quality water which can have environmental benefits as well as leaving higher quality water for other users in the community. Mines frequently have water treatment facilities on site so that lower quality water can be treated to a quality that is ‘fit-for-purpose’ – that is, treated to a quality that is suitable for the purpose it is being used. Many mines recycle a high proportion of their water on site, with some mines recycling up to 80% of their water used.
There is sometimes potential for mines to share water with other mines or industries in the region. In the Hunter Valley, a water-sharing network has been implemented between a number of mines so that mines with excess water can supply those needing more. At Lithgow, Springvale Colliery supplies excess mine water to a local power station, reducing both the power station’s demand for fresh water and the mine’s discharges into local waterways. In another example, Clarence Colliery supplies groundwater to the Lithgow town’s water catchment system to augment town water supplies. This water sharing initiative effectively drought proofs the town of Lithgow.
Because water is so critical for mining operations, mines implement sophisticated water management plans which can include significant data collection and water monitoring and analysis to provide an accurate picture of the quantity and quality of available water and water needs, both now and in the future. This is particularly important when available water is low or can fluctuate widely.
Mining operations have begun to use what is known as ‘water accounting’ methods to keep track of their water needs and availability. Water accounting is a system that reconciles the inputs to, storages within, and outputs from the mine over a certain time period, as well as the quality of the water. Since 2006 the NSWMC has been working closely with the Minerals Council of Australia to develop a new water metrics framework for the minerals industry that provides greater consistency in the application of water accounting methods. The aim of the development of this leading practice is to further improve the level of knowledge and water management on sites. The framework will also enable benchmarking across the industry to assist the industry identify leading practices and disseminate these across the industry for continual improvement.
Many mines conduct daily and weekly water balances which measure the volume and quality of water inflows (e.g. rainfall, treated town effluent or extraction from rivers or aquifers), current storage on site (e.g. dams), water use (e.g. minerals processing and dust suppression), water losses (e.g. evaporation and seepage), water recycling, and any discharges from the mine. Forecasts are made as to how these will change in the future based on factors such as predicted operational requirements and weather patterns.
The minerals industry is continually looking at ways to improve water management. Water audits allow companies to identify water savings in their operations, as well as allowing companies to benchmark against other operations. Individual mines conduct research into the best ways of managing water on their sites, and develop innovative methods of reducing water consumption. Rio Tinto’s Floating Module was developed at Northparkes Mines in the Central West, and has been shown to reduce evaporation from storage dams by up to 90%.
The Australian minerals industry is taking a lead role in implementing the objectives of the National Water Initiative. At a national level the minerals industry developed a Strategic Framework for Water Management in the Minerals Industry in partnership with the Ministerial Council on Mineral and Petroleum Resources. The framework promotes a strategic approach to water management so that water is more efficiently managed as a community, business and environmental asset. The industry nationally has partnered with the Australian Government, research, academic and community representatives, to develop a Water Management handbook as part of its Leading Practice Sustainable Development Program for the Mining Industry series.
Mines require licences to extract water from rivers or aquifers, just like any other industry. NSW currently operates under two pieces of water legislation: the Water Act 1912, and the Water Management Act 2000. The Water Management Act 2000 regulates water use for rivers and aquifers where water sharing plans have commenced, while the Water Act 1912 continues to operate in other areas.
A water sharing plan establishes rules for sharing water between the environmental needs of the river or aquifer and water users, and also between different types of water users such as town supply, rural domestic supply, stock watering, industry and irrigation. Access licences entitle holders to a share of the available water and are categorised according to priority of access. For example, in regulated rivers, high security licences have priority over general security licences. Water licences for town water supply have priority over other types of licences.
In most areas the Minister for Water makes Available Water Determinations for each water source covered by a water sharing plan each year, more in drought affected areas. Available Water Determinations determine the volume of water available for extraction for the various categories and subcategories of access licences. The amount of water, or allocation, a licence holder is entitled to extract is expressed as a unit share of the total available water for most commercial or general security licences (e.g. irrigation of annual crops, minerals and other industries) and as a volume for high security uses (e.g. irrigation of permanent plantings, minerals industry and power generation) and specific purposes such as town water and domestic and stock supply.
Water sharing plans also set rules for water trading, that is, the buying and selling of water licences and allocations. For most new commercial purposes, water trading remains the only way that water can now be obtained since the available water is fully allocated in most areas of the state and some areas have embargos on further licences. Water sharing plans deliver security and flexibility in water trading since the licence is granted in perpetuity, separate from land ownership and are issued separately from the approvals to construct water supply works (e.g. pumps, dams, bores) and the approvals to use the water.
In contrast, a Water Act 1912 licence is generally tied to the land as the licence covers both the right to take a specific volume of water as well as the works to be constructed. Most Water Act 1912 licences for commercial purposes also have to be renewed every five years.
In NSW, 36 water sharing plans have commenced, covering 80 per cent of water extracted including most of the regulated river systems (those controlled by major dams for rural water supplies), a number of unregulated river systems and the major inland alluvial aquifers. Most of the plans commenced in July 2004. The five inland alluvial groundwater plans commenced in October or November 2006.
Macro water plans, which are water sharing plans which apply to a number of water sources across catchments or to different types of aquifers, are being prepared for unregulated rivers and groundwater in NSW and will include up to 28 surface water plans and 5 groundwater plans. These plans will account for most of the remaining 20 per cent of water use not already managed by existing water sharing plans.
The NSW minerals industry remains a supporter of the principles within the 2004 Intergovernmental Agreement on a National Water Initiative (NWI). As such the NSW Minerals Council supports the rapid preparation and implementation of water sharing plans in areas where they are not yet in place. The coverage of water sharing plans and associated access arrangements must be expanded to enable surface and groundwater interactions to be managed and water to flow to its highest value use through an open and transparent water market operating across NSW.
The NSW Minerals Council also supports comparable water reporting requirements across all water users to ensure transparent, consistent and accountable water data is available for decision makers.
The minerals industry also requires licences for any discharges. Any discharges to the environment need to meet strict environmental standards that are set by independent bodies and adopted by government. In NSW, water quality is managed to the Australian and New Zealand Environment Conservation Council (ANZECC) 2000 Guidelines. These widely adopted guidelines provide a framework and scientific information for conserving ambient water quality in rivers, lakes, estuaries and marine waters across, and around NSW. The guidelines provide the government with a way to consider water quality at both a strategic planning level and a local level in assessing impacts of developments, including minerals operations.
The ability to discharge water is licenced under the Protection of the Environment Operations Act 1997. Environment Protection Licences are only provided after rigorous environmental assessment and mitigation and management strategies have been considered. In many cases mines are nil discharge sites, choosing to manage the water on site. Mines that do discharge may need to treat the water to minimise unacceptable environmental impacts on waterways.
Mining can affect the quantity or quality of surface and groundwater resources. This can occur, for example, when mining activities intersect aquifers, or mine subsidence affects aquifers or rivers. These potential impacts are assessed during planning approval and measures are taken to reduce impacts to acceptable levels, while ongoing monitoring assesses whether the predicted impacts are accurate and enables ongoing management of potential impacts
There have been concerns in the community that underground mining in the Southern Coalfield has impacted the quality or quantity of Sydney’s drinking water. An Independent Expert Panel appointed by the NSW Government to conduct an inquiry into the impacts of mining in the Southern Coalfield found:
“The Panel is not aware of any scientific evidence supporting the view that subsidence impacts on rivers and significant streams, valley infill or headwater swamps, or shallow or deep aquifers have resulted in any measurable reduction in runoff to the water supply system operated by the Sydney Catchment Authority or to otherwise represent a threat to the water supply of Sydney or the Illawarra region.”
Mine runoff and discharges of excess water from mine sites are regulated to ensure they are appropriately treated before being released from site. Mines are required to obtain and comply with Environment Protection Licences, which outline the quantity and quality of water that can be discharged from site, which takes into consideration the capacity of the surrounding environment to sustain the discharges.
In the Hunter Valley, the Hunter River Salinity Trading Scheme is an innovative market based scheme that controls the level of salt discharged into the Hunter River by mines and power stations. Furthermore, Discharges can only occur under strictly controlled licence conditions and by way of holding salinity credits that are tradeable amongst industry dischargers. Every two years, 20% of the total salinity credits expire and must be repurchased through a special auction process. Under the Scheme, mines and power stations can only discharge surplus saline water when river flows are high or in flood. A separate scheme applies to the discharge of saline waters in flood flow. The Hunter River Salinity Trading Scheme has been very successful in managing salinity levels in the Hunter River and is an example of an economic environmental trading process being used to protect water resources.
Relevant Documents
Fact Sheet – Water Use in the NSW Minerals Industry
Case Study – Springvale Coal – Delta Electricity Water Transfer Scheme
Case Study – Northparkes Mine: Rio Tinto Floating Module
External Links
DRET – Leading Practice Sustainable Development Program for the Mining Industry - Water Management Handbook
Strategic Framework for Water Management in the Minerals Industry
ANZECC Water Guidelines
Department of Environment, Climate Change and Water - Hunter River Salinity Trading Scheme
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